Alnoor Bhimani speaks at the Digital innovations, financial inclusion and sustainability Conference in India

Professor Alnoor Bhimani delivered a talk and appeared on a panel discussing ‘Innovations and business models for accessible financial services’ forming part of the Indian Institute of Management Bangalore golden jubilee international symposium on 3 November 2023.

He spoke on how India’s fast paced digitalisation drives are reshaping the social and economic landscape of the country. Financial inclusion is associated with not just financial wellbeing but also with the integration of dispersed populations and the marginalised into wider national trajectories of development and networks. Professor Bhimani noted how the development of technology far exceeds most people’s capacity to deal with the scale of changes this unleashes with many not grasping the potential opportunities that are made possible. The ability to operate web-based platforms, understand financial concepts, having access to mobile apps, and being cognisant of the positive impact of financial planning and interfaces are complex dimensions of financial inclusion but ones any nation must seek to bring about for its population.   

Millions of households as well as micro-enterprises in India and across South Asia have limited access to formal financial services. This stunts their capacity to grow. Reliance on informal sources of finance including family and friends and funds sourced via money lenders charging high interest rates can exacerbate problems and lead to debt traps aside from mobilising constraining culturally contextual challenges. He noted also that financial inclusion enabled by financial technologies and innovations can assist but should not be seen as a comprehensive panacea.

Financial inclusion has effects that are inevitably beneficial for the unbanked but also rests on adequate financial literacy being present. In India, women in particular, have lesser access to internet connected devices and have lower levels of financial literacy than men though they are adept at managing household expenditures. Once they cross voids both of web access to simple financial services and shortfalls in financial literacy, the impact on their lives and on the nation is immediate and far reaching. This is similarly the case for farmers and micro-entrepreneurs who traditionally have not been able to access financial services. Professor Bhimani cautioned that while innovations in fintech and increased financial literacy are desirable, there must also be an awareness that excessively economistic education and financialised mindsets should not be unwittingly pursued.